Zreika v State of NSW [2009] NSWCA 99 (6 May 2009)

Last Updated: 7 May 2009

NEW SOUTH WALES COURT OF APPEAL

CITATION:
Zreika v State of NSW [2009] NSWCA 99


FILE NUMBER(S):
40100/08

HEARING DATE(S):
24 April 2009

JUDGMENT DATE:
6 May 2009

PARTIES:
Haysam Zreika (A)
State of New South Wales (R)

JUDGMENT OF:
Beazley JA Ipp JA Macfarlan JA

LOWER COURT JURISDICTION:
District Court

LOWER COURT FILE NUMBER(S):
3315/02

LOWER COURT JUDICIAL OFFICER:
Robison DCJ

LOWER COURT DATE OF DECISION:
5 December 2007


COUNSEL:
P G Maiden SC and T J Boyd (A)
M Cashion SC and S C Finnane (R)

SOLICITORS:
Kheir & Associates (A)
I V Knight, Crown Solicitor (R)

CATCHWORDS:
DAMAGES - measure and remoteness of damages in actions for tort - measure of damages - non-economic loss - Civil Liability Act 2002 s 16 - whether non-economic loss at least 15 per cent of the most extreme case - economic loss - Civil Liability Act 2002 s 13 - award of buffer for future economic loss.

LEGISLATION CITED:
Civil Liability Act 2002 ss 13, 16

CATEGORY:
Principal judgment

CASES CITED:
Fegan v Lane Cove House Pty Limited [2007] NSWCA 88
K’Mart Australia Limited v McCann [2004] NSWCA 283
New South Wales v Zerafa [2005] NSWCA 187
Penrith City Council v Parks [2004] NSWCA 201
State of New South Wales v Moss [2000] NSWCA 133; (2000) 54 NSWLR 536
The Nominal Defendant v Lane [2004] NSWCA 405

TEXTS CITED:


DECISION:
(a) The appeal is upheld.
(b) The damages that Robison DCJ awarded the appellant are increased by $40,000.
(c) The respondent to pay the appellant’s costs of the appeal and the costs of the trial.
(d) The respondent to be entitled to a certificate under the Suitor’s Fund Act 1951 if otherwise entitled.



JUDGMENT:

- 1 -

IN THE SUPREME COURT
OF NEW SOUTH WALES
COURT OF APPEAL

CA 40100/08

DC 3315/02

BEAZLEY JA

IPP JA

MACFARLAN JA

WEDNESDAY, 6 MAY 2009

Haysam ZREIKA v STATE OF NEW SOUTH WALES

Judgment

1 BEAZLEY JA: I agree with Ipp JA.

2 IPP JA: On 18 February 2001 the appellant was assaulted at the Parramatta Correctional Centre and, in consequence, suffered injuries. He brought a claim in the District Court against the respondent for damages in negligence. His claim was dismissed. The District Court judge held that the respondent had not been negligent. The appellant appealed to this Court against that finding. His appeal was upheld and the matter was remitted to the District Court for assessment of damages.

3 Robison DCJ assessed damages in the sum of $8,824.40. This amount was for past and future medical expenses only. His Honour dismissed the claims by the appellant for non-economic loss, past economic loss, past loss of superannuation, future economic loss and future loss of superannuation entitlements.

4 In argument on appeal, Mr Maiden SC, who together with Mr Boyd appeared for the appellant, pressed only two heads of damage. These were, firstly, damages for non-economic loss and, secondly, a buffer for damages for economic loss, which he submitted should have been awarded by way of a buffer. At trial the claim had been based on a specific weekly loss of income.

5 It is common ground that the appellant sustained the following injuries:

(a) an injury to his right shoulder, the precise nature and extent of which is not known;

(b) an injury to the head resulting in laceration with subsequent scarring towards the right side of the right eye;

(c) headaches and periodic benign vertigo; and

(d) symptoms of post-traumatic stress disorder, depression and anxiety.

6 Robison DCJ pointed out that there was “very little controversy as to the nature of the injuries the plaintiff sustained”. The real dispute before his Honour was the nature and extent of the appellant’s disabilities. His Honour found that the appellant was not a credible witness in many respects and his evidence in most respects was not accurate. This complicated the assessment of the appellant’s disabilities.

7 On appeal, Mr Maiden concentrated on the appellant’s shoulder injury. He submitted that his Honour did not appreciate the true extent of the injury.

8 In a long, narrative form of judgment, his Honour quoted several extracts from the many medical reports admitted into evidence. It is difficult to extract from the judgment precise factual findings concerning the injury to the appellant’s right shoulder.

9 Dr Cordato reported that the appellant sustained a “fracture sublaxation of his right acromioclavicular joint with minimally displacement inferiorly” and that he “will continue to intermittently experience right acromioclavicular joint symptoms”.

10 Dr Berry reported that the appellant’s shoulder injury rendered him permanently unfit for work “that requires the extremes of heavy lifting with the right arm and working with the right arm above shoulder height for lengthy periods”. Dr Berry stated that the appellant was left with permanent pain in the right shoulder and this prevented him from performing forceful pushing and pulling activities with the right arm, particularly if it was elevated away from the side of the body. According to Dr Berry, there was unlikely to be any change in the appellant’s condition in the foreseeable future. Dr Berry expressed the opinion that the appellant had a 15 per cent permanent loss of the efficient use of his right arm, at or above the elbow, including losses below the elbow.

11 Dr Kirsh, the treating doctor, expressed a similar opinion. He said that the appellant was unfit to perform heavy duties which required lifting or stressing. Dr Kirsh considered that the appellant would be “upgraded by surgery”. Dr Kirsch was of the opinion, at the time of his report dated 7 April 2003, that the appellant had a 15 per cent permanent loss of the efficient use of his right upper limb at and above the level of the elbow.

12 The amount of $8,824.40 that his Honour allowed for future medical expenses related to an operation to the appellant’s right shoulder involving repair of the derangement to the small meniscus within the acromioclavicular joint. This surgery was that which Dr Kirsch recommended and involves arthroscopy and clavicular excision.

13 Dr Donaldson, an orthopaedic surgeon, whose report the respondent tendered, referred to a fracture (at the outer end of the right clavicle adjacent to the acromioclavicular joint) to which Dr Kirsch had referred. Dr Donaldson said:

“His symptom complex suggests derangement of the small meniscus within the acromioclavicular joint or secondary osteoarthritic change has arisen there following the previous fracture. That scenario often results from a fall onto the point of the shoulder. Many footballers have surgery for that condition and return to professional play thereafter without residual impairment. If x-rays were to be done and showed osteoarthritis in the joint his symptoms are amenable to such treatment; simple excision of the outer centimetre of the clavicular de-functions the acromioclavicular joint and should completely relieve his pain without compromising shoulder function.”

14 According to Dr Donaldson, prior to surgery the appellant had in the order of 10 per cent upper extremity impairment “if shoulder x-rays revealed deformity within the acromioclavicular joint from past injury”. Dr Donaldson went on to say that the “current situation” regarding the acromioclavicular joint was “permanent”. The shoulder was likely to ache when the weather was inclement and when the appellant kept his arm raised above shoulder height for long periods or if he attempted repeatedly to lift heavy loads.

15 Mr Maiden submitted that, on the proper understanding of the medical reports, there was a real possibility that the appellant’s injury was a fracture to the acromioclavicular joint (that was a continuing source of pain and disability) and not merely a derangement of the meniscus. According to Mr Maiden, the surgery to the meniscus would not alleviate symptoms caused by the fracture.

16 His Honour did not make precise findings as to the cause of the appellant’s continuing shoulder symptoms. This is understandable as the point Mr Maiden raised was not exposed at the trial and was not the subject of direct medical evidence.

17 In any event, even if it is accepted that there was a fracture of the acromioclavicular joint and that the appellant’s shoulder symptoms stem from the fracture (rather than the meniscus), I would not hold that the appellant has satisfied the threshold test of “15 per cent of the most extreme case” required by s 16 of the Civil Liability Act 2002. Before giving my reasons for this opinion, I need to deal with the other injuries the appellant sustained.

18 Dr Cordato reported that the appellant will continue intermittently to experience “tension type headaches” and that he is also at risk of “future recurrences of benign positional vertigo”. In addition he noted that the appellant suffers from symptoms of post-traumatic stress disorder that contribute to “occasional” impaired concentration on his part. Dr Roberts, a neuro-psychologist, reported that the appellant’s responses did not indicate any significant depression or anxiety, but were consistent with a moderate level of stress. Professor Watson described the head injury from which the appellant suffered as “mild”.

19 The evidence of the various doctors in which they expressed opinions as to the percentage loss of efficient use of the right arm or impairment of the right arm is of little help in assessing whether the severity of the appellant’s non-economic loss is at least 15 per cent of the most extreme case (as s 16 of the Civil Liability Act requires). That assessment has to be made by reference to the whole person, not part of the body – such as a single limb.

20 Robison DCJ, after reviewing the evidence, said: “having regard to all of the evidence I determine that the severity of the plaintiff’s non-economic loss as a proportion of a most extreme case is ten per cent”.

21 Mr Maiden submitted:

“This man has had severe pain ... He has got severe pain in his dominant right upper limb, the one limb that he must use for everything that he does. And in respect of his right shoulder ..., it is possible that there is a fracture in the AC joint and it is osteoarthritic ...”

22 I do not discount the injuries from which the appellant suffered. I take into account the fact that, to the degree stated by Dr Donaldson, he will be permanently disabled in his capacity to work and, generally, to enjoy life. Nevertheless, I am unable to discern any error in the assessment made by the trial Judge. I would dismiss the appeal in respect of non-economic loss.

23 I turn now to economic loss and the claim for a buffer.

24 Prior to his injury (on 18 February 2001), the appellant worked in the formwork carpentry industry. Despite a disavowal on the appellant’s part, the judge found that he was apprenticed as a formwork carpenter.

25 From about November 2004, for intermittent periods, the appellant worked as a car salesman and did glazing work in the car industry. The appellant, in evidence, agreed that he could work as a glazier in the car industry although, from time to time, his shoulder condition hampered him and he needed assistance in lifting glass up to the height of the vehicles in order to install windscreens.

26 In what appears to be 2006 (when the appellant obtained an ABN registration number), the appellant established his own business as an automotive glazier, known as “First Class Auto Glass”. His Honour found that the appellant had “an ability to effectively run a business”. At times, the appellant used a sub-contractor to do the glazing while he was responsible for obtaining business from insurance companies and other sources.

27 Robison DCJ found that the appellant, over time, had “built up a considerable degree of expertise” in the “auto glazing field” and his business “appeared to be a flourishing one”. His Honour went so far as to say that the appellant’s employment prospects “have been vastly improved as a result of his employment” in the glass industry. His Honour emphasised this when saying, “[A] view could be held that the [appellant’s] endeavours in the auto glazing industry will be far more remunerative for him than they would have been in the construction industry”.

28 Section 13 of the Civil Liability Act governs the appellant’s claim for damages for future economic loss. This provides:

“13 Future economic loss — claimant’s prospects and adjustments

(1) A court cannot make an award of damages for future economic loss unless the claimant first satisfies the court that the assumptions about future earning capacity or other events on which the award is to be based accord with the claimant’s most likely future circumstances but for the injury.

(2) When a court determines the amount of any such award of damages for future economic loss it is required to adjust the amount of damages for future economic loss that would have been sustained on those assumptions by reference to the percentage possibility that the events might have occurred but for the injury.

(3) If the court makes an award for future economic loss, it is required to state the assumptions on which the award was based and the relevant percentage by which damages were adjusted.”

29 The implications that s 13 has on the power of a court to award a buffer for future economic loss were discussed in Penrith City Council v Parks [2004] NSWCA 201. Giles JA (with whom Cripps AJA agreed) said (at [5]):

“I consider that it is still open to assess damages by way of a so called ‘buffer’. The occasion for a buffer is when the impact of the injury upon the economic benefit from exercising earning capacity after injury is difficult to determine. There is still a comparison between the economic benefits, although the difference can not be determined otherwise than by the broad approach of a buffer. Section 13(1) can be fulfilled, and the assumptions as to exercising earning capacity before injury can be stated.”

30 Giles JA’s observations have been followed by several cases in this Court. See, for example, K’Mart Australia Limited v McCann [2004] NSWCA 283, The Nominal Defendant v Lane [2004] NSWCA 405, New South Wales v Zerafa [2005] NSWCA 187. It was not suggested that this Court should not follow Penrith City Council v Parks, and I propose to do so.

31 There was evidence that, but for the injury, the appellant’s likely net earnings (on the basis that he had yet to finish his apprenticeship) in the period 1 October 2001 to 1 October 2004 would have been $600 net of tax per week.

32 Thereafter, his net earnings would probably have increased to $942 net of tax per week. I infer that this evidence is based on the assumption that the appellant would have completed his apprenticeship. The probabilities, however, against the likelihood of this assumption have materialised. For reasons unrelated to the assault, the appellant did not complete his apprenticeship and his work history does not suggest that he would ever have done so.

33 Robison DCJ found it was not possible to determine the income that the appellant received as an employed glazier and in his glazing business. This was because of the failure of the appellant to produce appropriate documentary evidence in support of his case and because of his Honour’s view of his credibility. There was no challenge to this approach by the judge.

34 According to the appellant, he earned in the order of $520 per week gross when employed as a trainee in the glazing industry. By reason of the difficulties with the appellant’s evidence it is not possible to infer that his income in the glazing industry has been any less than his income would have been had he not been assaulted. Indeed, from his Honour’s comments concerning the success of the appellant’s business, it may well be that he has earned more than he would have earned in the formwork carpentry field.

35 The appellant’s challenge to Robison DCJ’s dismissal of his claim for loss of past economic loss therefore fails.

36 As regards the loss of future capacity to work, the appellant has not proved that, should he continue permanently in the glazing industry, he will suffer any financial loss.

37 The evidence, however, firmly establishes that that the appellant’s injuries – particularly his shoulder injury – have caused him to lose capacity to work in the formwork carpentry industry and any other industry that requires, for long periods, the lifting of heavy weights, or raising the arm above shoulder height, or performing forceful pushing and pulling activities with the right arm. If, for any reason, the appellant is not able to retain employment in the auto glazing industry, these disabilities will unquestionably hamper attempts on his part to obtain employment in other industries involving manual labour.

38 In State of New South Wales v Moss [2000] NSWCA 133; (2000) 54 NSWLR 536, Heydon JA said (at [87], 559):

“In short, where earning capacity has unquestionably been reduced but its extent is difficult to assess, even though no precise evidence of relevant earning rates is tendered, it is not open to the court to abandon the task and the want of evidence does not necessarily result in non-recovery of damages. ... The task of the trier of fact is to form a discretionary judgment by reference to not wholly determinate criteria within fairly wide parameters. Though the trier of fact in arriving at the discretionary judgment must achieve satisfaction that a fair award is being made, since what is involved is not the finding of historical facts on a balance of probabilities, but the assessment of the value of a chance, it is appropriate to take into account a range of possible outcomes even though the likelihood of any particular outcome being achieved may be no more than a real possibility.” (Citations omitted)

39 Of course, the evidence may disclose that a reduced capacity to work may not be productive of financial loss, even where there is an unquestionable loss of capacity to earn. In that event no buffer will be awarded: Fegan v Lane Cove House Pty Limited [2007] NSWCA 88.

40 Robison DCJ held that the appellant had failed to discharge the onus imposed by s 13 on a plaintiff in his position. His Honour said that he was left, “not in an area of speculation, but simply in an area of guesswork”.

41 I doubt, however, whether there is any material difference between “speculation” and “guesswork”. Unlike the factual situation in Fegan v Lane Cove House Pty Limited, this case is in the same category as State of New South Wales v Moss. As I have pointed out, the appellant’s earning capacity has unquestionably been reduced. Should the contingency arise that the appellant cannot obtain employment in the auto glazing industry, his loss of capacity to earn is likely to be productive of financial loss. The extent of that loss is difficult to assess. Accordingly, in my view, it would be appropriate in this case to award the appellant a buffer.

42 As in The Nominal Defendant v Lane (at [54] per Giles JA) the claimant’s most likely future circumstances, but for the injury, can be found. The appellant’s most likely future circumstances but for the injury were likely to involve employment in the formwork carpentry industry or in some other industry involving manual labour. The evidence did not establish that such employment was likely to produce a greater income than that which the appellant is likely to earn in the auto glazing industry.

43 In my view the appellant should be awarded what McClellan AJA in Penrith City Council v Parks (at [58]) called “[a] modest award as compensation for the chance that a claimant may be disadvantaged in the future because of the injury”. That involves the award of a buffer.

44 In considering the buffer that would be appropriate, I take into account the possibility that, at some future time, the appellant might not be able to work in the auto glazing industry, his talent for running his own business, his chequered work history as an employed person, the periods that he was out of employment and the reasons for him not being employed.

45 Taking all these matters into consideration, I consider that an appropriate buffer would be $40,000. In effect, ignoring the accelerated benefits of the award, this sum provides the appellant with a buffer of $600 per week (the sum that he was earning while a formwork carpentry apprentice) for a period of some 15 months (or 66 weeks). In my opinion, this is a reasonable basis for determining the compensation to which the appellant is entitled for the chance that he may be disadvantaged in the future because of the injuries he suffered.

46 Accordingly, I propose the following orders:

(a) The appeal is upheld.

(b) The damages that Robison DCJ awarded the appellant are increased by $40,000.

(c) The respondent to pay the appellant’s costs of the appeal and the costs of the trial.

(d) The respondent to be entitled to a certificate under the Suitor’s Fund Act 1951 if otherwise entitled.

47 MACFARLAN JA: I agree with Ipp JA.

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LAST UPDATED:
6 May 2009